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Some of the companies I've analyzed lump quite a bit in "other current liabilities," but don't break out the components in the notes. Should I use this number in working cap? Or, exclude it because I don't know what is included?

Thanks in advance.
Matt
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Yes!

Key point with defensive income statement/free cash flow is this: increases in working capital, fixed capital and other long-term assets are expenses because they are (1) uses of cash and (2) you never know whether these outlays will generate higher future revenue, production economies, etc. Better to err on the side of caution.

Also, many companies will provide more detail of "other current assets" and "other current liabilities" in the footnotes.
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"Yes!

Key point with defensive income statement/free cash flow is this: increases in working capital, fixed capital and other long-term assets are expenses because they are (1) uses of cash and (2) you never know whether these outlays will generate higher future revenue, production economies, etc. Better to err on the side of caution.

Also, many companies will provide more detail of "other current assets" and "other current liabilities" in the footnotes."

Hewitt,

Haven't had my caffeine fix yet, so not thinking straight. Does this mean "Yes - include," or "Yes - exclude?"

John
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Hi John -

I should have said "include."

H
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This is very helpful. Thank you, Hewitt.

Matt
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